In Virginia, any co-owner of real property (excluding spouses who own property as tenants by the entirety) has the right to file a suit for partition—a specialized lawsuit in which the circuit court determines who the owners are, and divides the property among them. To take a simple case, consider a twelve-acre parcel of unimproved land, in which four people each own a 25% interest. In a partition suit, the court might award each owner three acres, assuming the characteristics of the property are uniform and each of the new three-acre parcels has access to a road.
It is easy to see that in many cases, division will not be possible. For example, what if there are four co-owners of a house in a suburban neighborhood on a quarter-acre lot? The house obviously cannot be divided four ways. Virginia law offers two alternatives. If one of the owners is willing to buy out the other, he or she may ask the court to require the other to sell. If none of the owners wants the property, any one of them may ask the court to force a sale. Bear in mind, however, that the court must first determine whether physically dividing up the property is feasible.
While not widely familiar, the partition process is important for many Virginians. Often, these suits begin in the context of “heirs property”—property that has been inherited by a number of relatives, often over multiple generations. Such property may be owned by dozens or even hundreds of heirs, some of whom may be unaware they own an interest.
Effective July 1, 2020, new laws enacted by the General Assembly may cause the partition process to become costlier and more difficult. First, the court is now required to order an appraisal of the property, unless all the parties agree on its value or the court determines the cost of the appraisal outweighs its evidentiary value. After the appraisal is done, the court must hold a hearing to determine the property’s value.
Second, if the court determines that physical division of the property is impractical, there are a number of factors which it must now consider in evaluating a party’s request to buy out the others. These factors include the duration of a party’s ownership, or that of his relatives; a party’s sentimental attachment to the property, including any attachment arising because the property has ancestral or other unique or special value; the use a party is currently making of the property, and the degree to which the party would be harmed if he or she could not continue the same use of the property; and the degree to which the parties have contributed their pro rata share of the applicable real estate taxes, insurance, and maintenance costs.
Finally, if the court orders the property to be sold, new, detailed rules will govern the sale. In most cases, the court will appoint a real estate broker. The broker will be supervised by the court, and will be required to file a detailed report.
These new rules are intended to protect co-owners, especially the owners of heirs property. Often, however, these additional procedures may increase the cost and complexity of partition suits.
The attorneys at Parker Pollard have extensive experience representing both plaintiffs and defendants in partition suits, including owners of heirs property. The new laws described above apply only to suits filed on or after July 1, 2020. If you have inherited real estate, or otherwise have a co-ownership interest in Virginia real property, and intend to seek partition or sale, you may wish to discuss the impact of these new laws with counsel.
The foregoing is presented for informational purposes only and is not legal advice. This information is not intended to create, and receipt of it does not constitute, an attorney-client relationship. You should not act upon this information without seeking professional counsel.